- The risk of another default by Cyprus over the coming years remains elevated, according to a report by Moody's Investors Service.

The ratings agency says this is due to very substantial risks to the country's economic performance and, as a result, the government's finances.

This is reflected in the negative outlook on the Caa3 rating of the government. Although it is not the rating agency's central scenario, Moody's sees a material risk of a Cypriot exit from the euro area, which is captured in the Caa2 country ceiling.

The rating agency's report is an annual update to the markets and does not constitute a rating action.

Moody's determines a country's sovereign rating by assessing it on the basis of four key factors -- economic strength, institutional strength, government financial strength and susceptibility to event risk -- as well as the interplay between them.

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